What these 2 charts of GOOG and AAPL reveal
Timothy J. Truebenbach is the
President of True Capital Management and general partner of True Capital
Partners LP, a hedge fund. He uses a disciplined model that trades on the
intermediate-term time frame. For a free trial to Tim’s Nightly Stock Analysis
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The market is testing investors at this point. We
saw large-scale distribution, or professional selling last Friday along with
some large sell-offs in leading stocks and a subsequent recovery.
Google
(
GOOG |
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Chart |
News |
PowerRating) and Apple
(
AAPL |
Quote |
Chart |
News |
PowerRating), the
market’s strongest two leading names felt the pressure last week and any bounce
has come on lighter volume.
The market is still in a confirmed uptrend, but
with some of the signals we have been seeing it is not exactly the smartest
thing to push the envelope by making new buys right now or exploring margin. At
this point, only the Dow stands below its 50-day moving average after briefly
breaching the 11,000 barrier.
The major positive that we can draw from the
current market is that the volatility is up and we are seeing bearish overtones
start to become more pronounced. It seems that every time the market has gained
any upward momentum, bullishness runs rampant and that seems to stop the rally
in its tracks.
For now, negative headlines of higher oil,
political uncertainty and global threats seem to be getting the best of the
stock market even though the U.S. economy is acting very well. Additionally, the
Federal Reserve has made numerous hints that the raising rate environment may be
coming to an end very soon.
For now, we will wait and see what signals price
and volume hand us.
Be Patient!
Tim